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Ashbel Smith on Currency and Financein the Republic of TexasHERBERT T. HOOVER*ASHBEL SMITH WAS A CLOSE OBSERVER OF THE FINANCIAL AFFAIRSof the Texas Republic. For one thing, he had private interestswhich forced him to keep abreast of economic trends. From hisarrival in 1837 until the economy faltered in 1840, he speculated inland, not only with his own money, but with that of his friendsas well.Smith gained further insight because he frequently was an officialin the central government. Immediately after his arrival he wasappointed to the office of Surgeon General of the Texas army. Later,in 1842-1843, he served as charge d'affaires to England and France;he became Secretary of State in 1844.' Nearly four decades later UnitedStates Senator Sam Bell Maxey of Paris, Texas, requested Smith'sappraisal of currency and finance in the Republic for use in supportof his stand against greenbackism. Smith responded with the followingrecollections:"During . . . the War of Revolution which severed Texas from Mexico,to wit A.D. 1835 and 1836, the Revolutionary Authorities of Texas in theirtemporary forms of government attempted to gain money by authorizingthe negotiation of Loans and the sale of Land Scrip. The modest sumsof money so raised were subsequently liquidated in part by Compromisewith additional scrip for land and in part they figured in the shape ofaccounts for supplies furnished the government; and the latter appearedas a charge or debt against the Republic, forming a portion of the PublicDebt of Texas. No Bills of Credit or Paper in any form purporting to bemoney for circulation were emitted by Texas during that period. Themoney then in use in Texas was coin and Louisiana bank notes then atpar with gold and silver, and an occasional United States Bank Note.After the organization of government under the Constitution, to wit, theConstitution of the Republic of Texas, 1836, by Act of the first Congress,*Mr. Hoover is assistant professor of history at the University of South Dakota.xWilliam Ransom Hogan, The Texas Republic: A Social and Economic History (Nor-man, 1946), 87-89.2Harold B. Simpson (ed.), Texas in the War, 1861-1865 (Hillsboro, 1965), loo."Ashbel Smith to Hon. S. B. Maxey, October 2o, 1879, Sam Bell Maxey Papers (TheMaxey Home, Paris, Texas). No alterations have been made in the punctuation of thisletter.